Palmer_Int’l Lit & Arbitration_Fall 2015
International Litigation & Arbitration
Ch. 1: Jurisdiction of U.S. Courts over Subject Matter in International Disputes
Types of Jurisdiction
– Legislative/prescriptive: Authority of state to make laws generally applicable.
– Enforcement: Authority of state to induce/compel compliance & punish noncompliance.
– Subject matter: Nonwaivable requirement for court to have power to hear type of claim brought.
– Legislative: Power of state to prescribe substantive law, regardless of applicable forum.
– Personal: Power of court to adjudicate claim & render judgment enforceable.
A. Introduction
– State trial courts possess general jurisdiction.
– Art. I: Powers not granted to Congress are expressly reserved to the states.
– Where Congress has not exercised authority, state law provides applicable rules.
– Federal statute confers subject matter jurisdiction on fed. court only within limits of Art. III.
– Fed. subject matter jurisdiction is generally nonwaivable requirement.
– Statutory authorizations principally applicable domestically but also internationally:
o Cases of federal question
o Diversity of citizenship (citizens of different U.S. states)
§ Applicable ONLY in international cases:
· Alienage jurisdiction over actions between U.S. and foreign parties
· Alien Tort Statute jurisdiction
· Jurisdiction over actions against foreign states under the FSIA.
– Defendants tried in state court may remove to federal.
o If basis for fed. jurisdiction is diversity of citizenship/alienage, can only be removed if neither are citizen of state where action is brought.
o If fed. question, case is removable.
– Erie Doctrine: In absence of fed. legislation, fed. courts must apply state law; procedural issues are federal.
o Discourages “forum shopping” between state/fed. courts.
o Avoidance of inequitable administration of law.
– Substantive fed. CL rules are fashioned rarely and when standards are satisfied:
o Proposed rules arise in area involving uniquely fed. interests.
§ Division of interstate waters, conduct of U.S. foreign relations, etc.
o Fed. CL fashioned only to prevent “significant conflict” between state laws & fed. policies/interests.
§ Ex. “Active State Doctrine”
· Banco Nacional de Cuba v. Sabbatino
o SC announces fed. “act of state” doctrine forbidding U.S. courts from adjudicating validity of certain governmental acts.
o “Act of state” doctrine principle of fed. CL equally binding on state/fed courts.
· First National City Bank v. Banco Para El Comercio Exterior de Cuba
o SC adopted fed. CL standard governing circumstances where separate legal identity of foreign state-related entities is disregarded.
· Zschernig v. Miller
o SC held unconstitutional statute forbidding heirs/legatees from receiving property from estates if it would be confiscated by foreign governments/U.S. heirs couldn’t reciprocally receive property from abroad.
· Sosa v. Alvarez-Machain
o Fed. courts have limited power to create CL causes of action for torts violating the “law of nations.”
o Cause of action must be “defined with a specificity” comparable to historically accepted violations, such as acts of piracy.
International Law
– Private: Disputes between private persons, in domestic courts/private arbitral forums, arising from activities involving two or more nations.
o Ex. Judicial jurisdiction, choice of forum/law, taking evidence abroad, service of process abroad, etc.
o States vs. corps.
– Public: International legal principles governing relations between sovereign nation-states.
– States are bound by rules of international law by express/implicit agreement:
o International agreements
o Customary law
§ Evidence from state actions, official statements, int’l agreements entered into, etc.
§ Jus cogens: Norms/principles of int’l law that countries believe themselves bound by.
· U.S. does not recognize customary law.
o General principles of law
§ Typically secondary source where no other rules of int’l law are available; derived from rules in major legal systems.
– Self-executing treaty: Intended to have immediate legal effects with contracting states without implementing legislation/regulation. (Supreme law of the land under Art. VI)
– Non-executive treaty: Contemplates domestic implementation of legislation.
– Conflicts between fed. statutes & treaties resolve by “last-in-time” rule.
– If no U.S. law on issue, courts look at customary int’l law.
o If fed. statute contrary to principles of int’l law, courts give Congress’ legislation authority.
§ Violates international law.
B. Alienage Jurisdiction of Fed. Courts
– Alienage jurisdiction limited to suits involving alien & U.S. citizen.
o § 1332(a)(2): Original jurisdiction where more than $75K at stake & between citizens of a State or subjects of foreign state.
o § 1332(a)(3): Authorizes fed. jurisdiction where aliens on both sides of suit & involves U.S. party.
C. Fed. Question Jurisdiction in Int’l Cases
– Most actions under § 1331 based on specific fed. substantive statutes.
o Ex. Plaintiff alleging violations of fed. antitrust laws, RICO, or securities laws.
– Fed. courts have jurisdiction in all cases where alien sues for tort only, in violation of law of nations/treaty of U.S.
– Foreign Sovereign Immunities Act (FSIA) tells you when a foreign sovereign has immunity/cannot be sued.
– ATS gives U.S. jurisdiction in suits involving violation of the law of nations.
Ch. 2: Jurisdiction of U.S. Courts over Parties to International Disputes
A. Introduction and Historical Background
– U.S. has personal jurisdiction when (1) legislative authorization belongs to forum’s courts, (2) exercise of jurisdiction is consistent with Due Process Clause.
– State long-arm statutes: Provide jurisdiction and service of process of state courts over nonresident defendants located outside of the state’s
e but it depends on the quality of the contact. (Specific Jurisdiction)
There are isolated contacts that that don’t give rise to the claim then there is no personal jurisdiction.
B. General Jurisdiction of U.S. Courts in International Cases
– Principle bases for general jurisdiction under Due Process Clause:
o Nationality, domicile, or residence
o Incorporation or registration to do business
o Consent
o Continuous and systematic activities within the forum
o Tag service
§ Blackmer v. U.S.
· There must be due process for the exercise of judicial jurisdiction in personam.
C. Specific Jurisdiction of U.S. Courts Over Foreign Defendants
– Specific jurisdiction: Over claims that arise out of/relate to a defendant’s activities within the State.
o Gray v. American Radiator & Standard Sanitary Corp.
§ ?
o World-Wide Volks v. Woodson
§ Reaffirming “purposeful availment” requirement.
· Foreseeability alone has never been a sufficient benchmark for personal jurisdiction under the Due Process Clause.
· Two-prong due process analysis:
o Court requires purposefully created minimum contacts between defendant and forum
o Jurisdiction cannot be exercised unless it is reasonable
o Asahi Metal Indus. Co. v. Superior Court
§ Awareness that the stream of commerce may/will sweep the product into the forum State does not convert the mere act of placing the product into the stream into an act purposefully directed toward the forum state.
– Reasonableness in int’l cases: (1) hardship from U.S. jurisdiction for int’l defendants, (2) int’l cases affecting foreign nations and U.S. int’l relations.
o Burger King Corp. v. Rudzewicz
§ Reasonableness is a predominant aspect of due process analysis.
o Afram Export Corp. v. Metallurgiki Halyps, SA
§ A state cannot force a nonresident to litigate in its courts unless there is “some act by which the defendant purposefully avails itself of the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its laws.”
· A contract between a resident of a state and a nonresident is not enough by itself to give the courts of the resident’s state jurisdiction over the nonresident in the resident’s suit for breach of the contract.
